Accounting Errors

These are the mistakes and omissions made by an accountant while recording transactions in
books of accounts.

Commonly found accounting errors are

a. Error of omission : It can be complete omission or partial omission

i) Complete omission: a transaction has neither recorded in the books of original
entry nor posted into the ledger accounts. Such errors will not get highlighted
through trial balance.
ii) Partial omission: only one aspect (either debit or credit) of a transaction has
remains unrecorded. It will affect the agreement of trial balance.
b. Error of commission: A transaction has incorrectly recorded in books of account. Such
errors will leads to an untallied trial balance
Examples:
i) A transaction has posted on the wrong side of ledger account.
ii) A wrong amount was posted on ledger account.
iii) Wrong totaling of ledger accounts
iv) Wrong balancing of ledger accounts
v) An account was entered on the wrong side of trial balance.
vi) Wrong totaling of trial balance
c. Error of principles: this error occurs due to the violation of accounting principles.
Eg: Usually happens when a revenue item is considered as a capital item and vice versa.

purchased furniture for Rs. 5000 was entered as

Purchases A/c Dr.
To Cash

Instead of
Furniture A/c…Dr.
To Cash
d. Error of compensation: Compensating error is when one error has been compensated by
an offsetting entry that's also in error.
e. Error of Duplication: A transaction has recorded more than once in to the book of
original entry and posted in to ledger accounts. Such errors cannot be detected through
trial balance.

Errors will get reflected in trial balance: error of commission, error of partial omission.

Errors will not get reflected in trial balance: error of complete omission, error of duplication,
error of compensation.